FX.co ★ Turkish lira goes through rough time

The Turkish lira has taken another hit. It plummeted to an all-time low. The dollar/lira exchange rate surpassed 34 lira for the first time ever.

At one point, the dollar/lira pair rose by 0.24%, reaching 34.00025. Analysts observe that this currency pair has appreciated by 25% over the past 12 months.

According to Bloomberg, Turkish state banks have started selling dollars to support the national currency. The steady drop in the Turkish lira took place in anticipation of Turkey’s central bank meeting. The regulator's agenda included a decision on the key interest rate. According to reports, on August 19, Turkish state banks sold more than $500 million to meet domestic demand.

At the meeting held on August 20, the regulator maintained the interest rate at 50% per annum for the fifth consecutive time. It is the highest interest rate in the last 20 years. The Turkish central bank plans to reduce inflation to 38% by the end of 2024 and to 14% by the end of 2025.